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As filed with the Securities and Exchange Commission on July 8, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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POPULAR, INC.
(Exact name of registrant as specified in its charter)
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PUERTO RICO 66-0416582
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
209 MUNOZ RIVERA AVENUE
SAN JUAN, PUERTO RICO 00918
(787) 765-9800
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
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BRUNILDA SANTOS DE ALVAREZ
POPULAR, INC.
209 MUNOZ RIVERA AVENUE
SAN JUAN, PUERTO RICO 00918
(787) 753-1017
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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COPIES TO:
JAVIER D. FERRER
PIETRANTONI MENDEZ & ALVAREZ
SUITE 1901, BANCO POPULAR CENTER
209 MUNOZ RIVERA AVENUE
SAN JUAN, PUERTO RICO 00918
(787) 274-4918
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of the Registration Statement.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [x]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [ ]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
Title of securities to Amount to be Proposed maximum aggregate price per Proposed maximum Amount of
be registered registered (1) unit (2) aggregate offering price (2) registration fee (3)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $6.00 par
value per share (including 2,000,000
attached rights to purchase shares $40.375 $ 80,750,000 $ 24,470.00
Series A Participating
Preferred Stock)
===================================================================================================================================
</TABLE>
(1)This Registration Statement also covers an indeterminate number of shares of
Common Stock which may be issued by the Registrant from time to time by virtue
of stock splits, stock dividends or similar transactions involving the
reclassification of the Common Stock.
(2)Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c), on the basis of the last sales price per share of the
Common Stock on June 30, 1997, as reported by the National Association of
Securities Dealers Automated Quotation National Market System.
(3) As permitted by Rule 429, the Prospectus included in this Registration
Statement also relates to the Registrant's Registration Statement No. 33-39028
on Form S-3 filed by the Registrant in connection with 1,000,000 shares of
Common Stock to be issued under its Dividend Reinvestment and Stock Purchase
Plan. The Registrant estimates that as of July 2, 1997, approximately 90,914
shares of Common Stock previously registered pursuant to Registration Statement
No. 33-39028 remained unsold. Such shares are being carried forward to the
Prospectus contained in this Registration Statement. The Registrant previously
paid a filing fee of $4,250 under the Registration Statement associated with
such carried forward securities.
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PROSPECTUS
POPULAR, INC.
Dividend Reinvestment and Stock Purchase Plan
Common Stock, Par Value $6 Per Share
This Prospectus describes the Dividend Reinvestment and Stock Purchase
Plan (the "Plan") of Popular, Inc. (the "Company"). The Plan provides holders
of shares of the Company's common stock, par value $6 per share (including the
attached rights to purchase Series A Participating Cumulative Preferred Stock,
the "Common Stock"), who elect to participate in the Plan with a convenient and
economical way of investing cash dividends and optional cash payments in
additional shares of Common Stock without payment of brokerage commissions,
fees or service charges.
Plan participants may have cash dividends on all or part of their shares
reinvested automatically in shares of Common Stock at a 5% discount from the
Average Market Price (as defined in Question 10 in this Prospectus) and may
make optional cash payments in any month for the purchase of Common Stock at
100% of the Average Market Price. Each optional cash payment must be at least
$25 and the total of such payments in any calendar month may not exceed
$10,000.
This Prospectus relates to an additional 2,000,000 shares of Common Stock
registered for sale under the Plan. Please Retain this Prospectus for Future
Reference.
Shareholders not currently participating in the Plan may enroll at any
time by completing an Authorization Form and returning it to Banco Popular de
Puerto Rico, the Plan Administrator, Attention: Popular, Inc. Dividend
Reinvestment and Stock Purchase Plan (718), PO Box 362708, San Juan, Puerto
Rico 00936-2708. SHAREHOLDERS WHO ARE ALREADY ENROLLED IN THE PLAN WILL
CONTINUE TO PARTICIPATE IN THE PLAN WITHOUT ANY FURTHER ACTION. Shareholders
who do not wish to participate in the Plan will receive cash dividends on the
Common Stock, as declared, in the usual manner.
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THE SECURITIES OFFERED HEREBY ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR
OTHER OBLIGATIONS OF ANY BANK OR SAVINGS ASSOCIATION AND ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION,
THE BANK INSURANCE FUND, THE SAVINGS ASSOCIATION
FUND OR ANY OTHER GOVERNMENTAL AGENCY.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EX
CHANGE COMMISSION (THE "COMMISSION"), THE SECURITIES OFFICE OF THE OFFICE OF
THE COMMISSIONER OF FINANCIAL INSTITUTIONS OF PUERTO RICO (THE "OFFICE OF
THE COMMISSIONER") OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
COMMISSION, THE OFFICE OF THE COMMISSIONER OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
--------------------
The date of this Prospectus is July 8, 1997
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). The reports,
proxy statements and other information filed by the Company with the Commission
may be inspected and copied at the Commission's public reference room located
at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549,
and at the public reference facilities in the Commission's regional offices
located at: 7 World Trade Center, 13th Floor, New York, New York 10048; and
Citicorp Center, 500 West Madison Street, Suite 400, Chicago, Illinois 60661.
Copies of such material may be obtained at prescribed rates by writing to the
Securities and Exchange Commission, Public Reference Section, 450 Fifth Street,
N.W., Washington, D.C. 20549. Such material may also be accessed
electronically, by means of the Commission's home page on the Internet at
http://www.sec.gov.
This Prospectus is included as part of a registration statement on Form
S-3 (together with all amendments and exhibits thereto, including documents and
information incorporated by reference, the "Registration Statement") filed with
the Commission by the Company, relating to the registration under the
Securities Act of 1933, as amended (the "Securities Act"), of the shares of
Common Stock of the Company offered hereby. This Prospectus does not contain
all of the information set forth in the Registration Statement, certain
portions of which have been omitted pursuant to the rules and regulations of
the Commission, and to which portions reference is hereby made for further
information with respect to the Company and the Common Stock offered hereby.
Statements contained herein concerning any documents are not necessarily
complete and, in each instance, reference is made to the copies of such
documents filed as exhibits to the Registration Statement. Each such statement
is qualified in all respects by such reference.
AS INDICATED BELOW, THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE
WHICH ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. DOCUMENTS RELATING TO THE
COMPANY, EXCLUDING EXHIBITS UNLESS SPECIFICALLY INCORPORATED THEREIN, ARE
AVAILABLE WITHOUT CHARGE UPON WRITTEN OR ORAL REQUEST TO AMILCAR JORDAN, SENIOR
VICE PRESIDENT, POPULAR, INC., 209 MUNOZ RIVERA AVENUE, HATO REY, PUERTO RICO
00918, (787) 764-1893.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated into this Prospectus by reference:
1. Annual Report on Form 10-K for the year ended December 31, 1996.
2. Description of the Common Stock set forth in the Company's
Registration Statements filed pursuant to Section 12 of the Exchange Act and
any amendment or report filed for the purpose of updating that description.
3. Quarterly Report on Form 10-Q for the quarter ended March 31, 1997 and
Quarterly Report on Form 10-Q for the quarter ended June 30, 1997.
4. Current Reports on Form 8-K, dated January 9, 1997, February 19,
1997, April 7, 1997, May 7, 1997, May 8, 1997 and June 11, 1997.
5. Registration Statement on Form 8-A, dated August 18, 1988, filed
pursuant to Section 12(g) of the Exchange Act, pursuant to which the Company
registered its Series A Participating Cumulative Preferred Stock Purchase
Rights.
6. Registration Statement on Form 8-A, dated June 17, 1994, as amended by
the Company's Amendment on Form 8-A/A, dated June 21, 1994, filed pursuant to
Section 12(g) of the Exchange Act, pursuant to which the Company's registered
its 8.35% Non-Cumulative Monthly Income Preferred Stock, 1994 Series A.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus shall be
deemed to be incorporated herein by reference and to be a part hereof from the
date of such filing. Any
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statement contained in a document incorporated or deemed to be incorporated
herein by reference shall be deemed to be modified or superseded for purposes
hereof to the extent that a statement contained herein or in any other
subsequently filed document which also is, or is deemed to be, incorporated
herein by reference modifies or supersedes such statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part hereof.
THE COMPANY
The Company is a diversified, publicly owned bank holding company
registered under the Bank Holding Company Act of 1956, as amended, and
incorporated in 1984 under the laws of the Commonwealth of Puerto Rico. The
Company is the largest financial institution in Puerto Rico. The
Company's principal executive offices are located at 209 Munoz Rivera Avenue,
Hato Rey, Puerto Rico 00918 and its telephone number is (787) 765-9800.
The Company provides a wide variety of financial services through its
principal subsidiaries Banco Popular de Puerto Rico ("Banco Popular" or the
"Bank"), Popular Securities, Inc. ("Popular Securities") and Popular
International Bank, Inc. ("PIB"). Banco Popular, the Company's principal
banking subsidiary was incorporated over 100 years ago in 1893 and is Puerto
Rico's largest bank. A consumer-oriented bank, Banco Popular has the largest
retail franchise in Puerto Rico. Banco Popular also has the largest trust
operation in Puerto Rico and is the largest servicer of mortgage loans for
investors. In addition, it operates the largest Hispanic bank branch network
in the mainland United States. Banco Popular also operates seven branches in
the U.S. Virgin Islands and one branch in the British Virgin Islands. Banco
Popular has three subsidiaries: Popular Leasing & Rental Inc., Puerto Rico's
largest vehicle leasing and daily rental company, Popular Finance Inc., a
small-loan and secondary mortgage company and Popular Mortgage, Inc., a
mortgage loan company.
Popular Securities is engaged in the business of a securities
broker-dealer in Puerto Rico, with institutional brokerage, financial advisory,
and investment and security brokerage operations. PIB, organized under the
Puerto Rico International Banking Center Act, is principally engaged in
providing managerial services to its subsidiaries. PIB owns all the
outstanding stock of Popular North America, Inc., a Delaware corporation,
which in turn owns all of the outstanding stock of Banco Popular FSB, a
federal savings association operating in New Jersey, Banco Popular
(Illinois), a bank operating in Illinois, and Banco Popular, N.A. (California)
and Banco Popular N.A. (Florida), national banking associations operating in
California and Florida, respectively. Banco Popular, FSB is the sole owner of
Equity One, Inc., a diversified consumer finance company engaged in the
business of granting personal and mortgage loans and providing dealer financing
through offices in the United States mainland.
USE OF PROCEEDS
The net proceeds from the purchase of shares of Common Stock directly
from the Company will be used for the Company's general corporate purposes
including investments in, or extensions of credit to, the Company's banking and
non-banking subsidiaries. The Company has no basis for determining the number
of shares of Common Stock that will ultimately be sold pursuant to the Plan or
the prices at which such shares will be sold.
DESCRIPTION OF THE PLAN
The following is a statement of the provisions of the Plan in question
and answer form.
PURPOSE
1. What is the purpose of the Plan?
The Plan was adopted by the Board of Directors of the Company on
February 12, 1991. The primary purpose of the Plan is to provide holders of
shares of the Company's Common Stock with a simple, economical and convenient
method of investing cash dividends and optional cash payments in additional
shares of Common Stock without payment of brokerage commissions,
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service charges or other fees. When such additional shares are purchased
directly from the Company, the Company will receive additional funds for
general corporate purposes.
The Plan is intended for the benefit of long-term investors, and
not for the benefit of individuals or institutions who engage in short-term
trading activities which cause aberrations in the composite trading volume of
Common Stock.
ADVANTAGES
2. What are the advantages of the Plan?
- Participants in the Plan ("participants") may have cash
dividends on all or part of their shares of Common Stock
automatically reinvested in additional shares at 95% of the
Average Market Price (as defined in Question 10).
- Participants may make optional cash payments of at least $25
and not more than $10,000 per calendar month for investment
in additional shares of Common Stock. Participants who are
residents of Puerto Rico may make optional cash payments by
authorizing the Plan Administrator to debit their accounts at
the Bank.
- Participants will not pay any brokerage commissions, service
charges or other fees in connection with the purchase of
shares of Common Stock under the Plan.
- Participants' funds will be fully invested because the Plan
permits fractions of shares to be credited to a participant's
account.
- Cash dividends on shares of Common Stock purchased through
the Plan and retained in a participant's account, including
dividends on fractional shares, will be reinvested in
additional shares.
- Participants will avoid record keeping costs and the need for
safekeeping of stock certificates for shares credited to
their Plan account through the free reporting and custodial
services provided under the Plan.
PARTICIPATION
3. Who is eligible to participate?
All holders of record of Common Stock (each an "eligible
shareholder") are eligible to participate in the Plan. A beneficial owner whose
shares are registered in a name other than his or her own (for example, in the
name of a broker, bank or other nominee) must either become a shareholder of
record by having such shares transferred into his or her own name or make
arrangements to have his or her nominee participate in the Plan on his or her
behalf.
Shareholders will not be eligible to participate in the Plan if
they reside in a jurisdiction in which it is unlawful for the Company to permit
their participation. The right of a shareholder to participate in the Plan is
not transferable apart from a transfer of his or her underlying shares of
Common Stock to another person. See Question 19 in connection with the manner
of notifying the Plan Administrator of an election to terminate participation
in the Plan.
4. How does an eligible shareholder participate?
An eligible shareholder may join the Plan by completing and signing
the Authorization Form accompanying this Prospectus and returning it to the
Bank, which is the Plan Administrator. See Question 15. A return envelope is
provided for this purpose. Where the stock is registered in more than one name
(for example, joint owners) all registered holders must sign exactly as their
names appear on the account registration. Beneficial owners who wish to
participate in the Plan must instruct their broker, bank or other nominee to
complete and sign the Authorization Form and return it to the Plan
Administrator. In certain situations where the broker, bank or other nominee
holds shares of a beneficial owner in the name of a major securities
depository, a Broker and Nominee Form may also be required to participate in
the Plan. See Question 5 for more information on the Authorization Form
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and Question 13 for additional information on the Broker and Nominee Form.
Authorization Forms, Broker and Nominee Forms and additional copies of this
Prospectus may be obtained by contacting the Plan Administrator at: Banco
Popular de Puerto Rico, PO Box 362708, San Juan, Puerto Rico 00936-2708,
Attention: Popular, Inc. Dividend Reinvestment and Stock Purchase Plan,
Telephone No. (787) 764-1893 or (787) 765-9800 (Exts. 6108 or 6112).
In addition, the Company may appoint from time to time one or more
information agents (the "Information Agent") for the Plan. The Company will pay
the fees and expenses of the Information Agent and may agree to indemnify the
Information Agent for certain liabilities which it may incur in connection with
the rendering of its services for the Plan.
5. What does the Authorization Form provide?
The Authorization Form provides for the purchase of additional
shares of the Company's Common Stock through the following investment options:
"FULL DIVIDEND REINVESTMENT" directs the Plan Administrator
to invest all cash dividends on all of the shares of Common Stock then or
subsequently registered in a participant's name, together with any optional
cash payments, in the purchase of additional shares in accordance with the
Plan.
"PARTIAL DIVIDEND REINVESTMENT" directs the Plan
Administrator to invest all cash dividends on only that number of shares of
Common Stock registered in a participant's name that is specified in the
appropriate space on the Authorization Form, together with any optional cash
payments, in the purchase of additional shares in accordance with the Plan.
"OPTIONAL CASH PAYMENTS ONLY" permits a participant to make
optional cash payments for the purchase of additional shares of Common Stock in
accordance with the Plan, while continuing to receive cash dividends on shares
registered in his or her name in the usual manner.
You may select either one of the dividend reinvestment alternatives
or the optional cash purchase alternative. If you sign and return an
Authorization Form with no investment alternative designated, you will be
enrolled in the Full Dividend Reinvestment option.
Cash dividends on all shares of Common Stock held in a
participant's account under the Plan will be reinvested in accordance with the
Plan, including dividends on shares purchased with optional cash payments,
unless the participant specifies otherwise by written notice to the Plan
Administrator or terminates participation in the Plan.
6. May a participant change investment options after enrollment in the
Plan?
Yes. A participant may change his or her investment option or the
number of participating shares at any time by completing a new Authorization
Form and returning it to the Plan Administrator at the address specified in
Question 15.
7. When may an eligible shareholder join the Plan?
An eligible shareholder may join the Plan at any time. If an
Authorization Form requesting reinvestment of dividends is received by the Plan
Administrator on or prior to the record date established for a particular
dividend, reinvestment will commence with that dividend. It is anticipated that
the dividend record dates will normally precede the dividend payment dates by
approximately two weeks. If the Authorization Form is received after the record
date established for a particular dividend, then the reinvestment of dividends
will not begin until the dividend payment date following the next record date.
See Questions 12 and 13 to determine when persons who select the
Optional Cash Payments Only option will begin to participate in the Plan.
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PURCHASES UNDER THE PLAN
8. What is the source of shares purchased under the Plan?
Shares of Common Stock purchased with reinvested dividends will be
purchased from the Company. Shares purchased with optional cash payments will
be purchased either from the Company, in which case such shares will be
authorized but unissued shares of the Company, on the open market or in
negotiated transactions. Since the establishment of the Plan, the shares of
Common Stock purchased with optional cash payments have been purchased in the
open market or in negotiated transactions. The Company, however, reserves the
right to purchase shares directly from the Company with optional cash payments.
All shares purchased on the open market or in negotiated transactions will be
purchased by J.P. Morgan Securities, Inc., as agent for the participants (the
"Agent"). Purchases of shares in the open market may be made in the
over-the-counter market or on any securities exchange where the Common Stock
may be traded.
9. How many shares will be purchased for participants?
A participant's account will be credited with the number of shares,
including fractions computed to four decimal places, equal to the total amount
to be invested by the participant less any taxes required to be withheld (see
Question 20) divided by the purchase price per share.
10. What will be the price of shares purchased under the Plan?
The price of shares purchased with reinvested dividends under the
Plan will be 95% of the average of the daily high and low sales prices of the
Common Stock on the NASDAQ National Market System, as reported in The Wall
Street Journal, for the period of the last five reported trading days
immediately preceding the relevant Investment Date (the "Average Market
Price"). See Question 11 for the definition of Investment Date. The price of
shares of Common Stock purchased directly from the Company with optional cash
payments under the Plan will be 100% of the Average Market Price. The price of
shares purchased in the open market or in negotiated transactions with optional
cash payments will be the weighed average price paid for all shares of Common
Stock purchased by the Agent for the relevant Investment Date.
If there is no trading in the Common Stock for a substantial amount
of time immediately preceding a dividend payment date, the price per share
shall be determined by the Plan Administrator on the basis of such market
quotations as it deems appropriate. No shares will be sold to participants in
the Plan at less than the par value ($6 per share) of such shares.
11. When will shares be purchased under the Plan?
Shares of Common Stock will be purchased for participants on the
relevant Investment Dates. The Investment Dates for purchases of shares with
reinvested dividends will be the Common Stock dividend payment dates.
The Investment Dates for purchases by the Agent with optional cash
payments in the open market or in negotiated transactions is the sixteenth day
of each month unless any such day is not a business day, in which case the
Investment Date will be the next succeeding business day. Shares of Common
Stock purchased with optional cash payments will be credited to a partici
pant's account as of the Investment Date in which they are purchased.
Subject to any limitations imposed by federal or state securities
laws, the Agent will have full discretion as to all matters relating to open
market purchases, including determination of the number of shares, if any, to
be purchased on any day or at any time of day, the price paid for such shares,
the markets on which such shares are to be purchased (including on any
securities exchange, in the over-the-counter market or in negotiated
transactions) and the persons (including other brokers and dealers) from
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or through whom such purchases are made. Under certain circumstances,
observance of the rules and regulations of the Securities and Exchange
Commission, including Regulation M under the Securities Exchange Act of 1934,
may require temporary suspension of such purchases by the Agent or may require
that purchases be spread over a longer period than indicated in Questions 11
and 12, in which event such purchases will be made or resumed as or when
permitted by such rules and regulations. The Company, the Plan Administrator,
and the Agent will not be liable when conditions prevent the purchase of shares
or interfere with the timing of purchases.
OPTIONAL CASH PAYMENTS
12. How do optional cash payments work?
Participants may make optional cash payments for the purchase of
additional shares of Common Stock at any time subject to the limitations
described below and in Question 13. Checks and money orders must clear prior to
the fifteenth day of a month in which the investment is to be made. Checks and
money orders that have not cleared prior to the fifteenth day of the month will
be retained by the Bank and applied to the purchase of shares on the next
Investment Date. No interest will be paid on optional cash payments held
pending investment. Participants are strongly urged to make their optional cash
payments as shortly as possible before the fifteenth day of the month but
allowing sufficient time to ensure that their payment clears prior to such day.
Optional cash payments received prior to the thirtieth day preceding the
Investment Date on which they would be invested will be returned to the
participant.
The minimum optional cash payment per month is $25 and the total
optional cash payments by a participant may not exceed $10,000 per month. The
same amount of money need not be sent each month, and there is never any
obligation to make an optional cash payment. Optional cash payments will be
refunded if a written request for a refund is received by the Plan
Administrator at least forty-eight (48) hours prior to the day when such
investment is to be made. Optional cash payments of less than $25 and that
portion of any optional cash payment which exceeds $10,000 will be returned to
the participant without interest.
13. How may optional cash payments be made?
A registered holder of the Company's Common Stock may make an
optional cash payment when enrolling in the Plan by enclosing a check or money
order made payable to "Banco Popular de Puerto Rico" with the Authorization
Form. Thereafter, a registered holder may make optional cash payments at any
time subject to the limitations discussed in Question 12 by using the cash
payment forms which will be attached to each participant's statement of
account. A broker, bank or other nominee, as holder on behalf of a beneficial
owner, may also utilize the Authorization Form for optional cash payments,
unless it holds the shares in the name of a major securities depository.
In the event a broker, bank or other nominee holds shares of a
beneficial owner in the name of a major securities depository, optional cash
payments must be made on the Broker and Nominee Form (the "B&N Form").
The B&N Form provides the sole means whereby a broker, bank or
other nominee holding shares of a beneficial owner in the name of a major
securities depository may invest optional cash payments on behalf of such
beneficial owner. In such case, the broker, bank or other nominee must use the
B&N Form for transmitting optional cash payments on behalf of the beneficial
owner. A B&N Form must be delivered to the Plan Administrator each time that
such broker, bank or other nominee transmits optional cash payments on behalf
of a beneficial owner. B&N Forms will be furnished at any time upon request to
the Plan Administrator or the Information Agent at the respective address or
telephone number specified in Question 15.
Participants who are residents of Puerto Rico and maintain a
savings or checking account at the Bank may make optional cash payments by
executing a form authorizing the Plan Administrator to debit their accounts at
the Bank for the purchase of shares under the Plan.
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COSTS
14. Are there any expenses to participants in connection with purchases
under the Plan?
No. All costs of administration of the Plan are paid by the
Company. Participants will not incur any brokerage commissions, service charges
or fees for shares purchased under the Plan. As discussed in Question 18,
however, if a participant withdraws shares from the Plan and requests the Plan
Administrator to sell the shares, the participant will be charged for any
related brokerage commissions and applicable transfer taxes on the sale, if
any.
ADMINISTRATION
15. Who administers the Plan?
The Bank, a wholly-owned banking subsidiary of the Company, as Plan
Administrator, administers the Plan for partici pants by acquiring newly issued
shares if available, keeping records, sending statements of account to each
participant, arranging for the custody of stock certificates, and performing
other duties related to the Plan. Shares purchased in the open market are
purchased by the Agent and delivered to the Bank, which holds shares of all
participants together in its name or in the name of its nominee.
The Bank also acts as dividend disbursing and transfer agent for
the Company's Common Stock.
All questions and communications regarding the administration of
the Plan, requests for additional copies of this Prospectus, the B&N Forms or
the Authorization Forms should be addressed to the Bank at the following
address and telephone number:
Banco Popular de Puerto Rico
PO Box 362708
San Juan, Puerto Rico 00936-2708
Attention: Popular, Inc.
Dividend Reinvestment and
Stock Purchase Plan (718)
Telephone: (787) 764-1893
REPORTS TO PARTICIPANTS
16. What kind of accounts are maintained for participants and what
reports on these accounts will be sent to participants in the Plan?
The Plan Administrator maintains a separate account for each
participant. All shares of Common Stock purchased for a participant under the
Plan will be credited to the participant's account. As soon as practicable
after each purchase of shares, the Plan Administrator will mail to each
participant a statement of account. The statement will summarize the
year-to-date transactions in the participant's account, and will indicate the
number of shares purchased under the Plan, the price per share paid and will
include any applicable tax information. Participants will also receive
quarterly statements of account and an annual statement showing the amount of
reinvested dividends as well as other transactions under the Plan. These
statements by participants should be retained by participants for his or her
own records. A participant may be required to pay a fee for copies of previous
statements. In addition, each participant will receive copies of the Company's
annual and quarterly reports to shareholders, proxy statements and information
for income tax reporting purposes.
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CERTIFICATES FOR SHARES
17. Will certificates be issued for shares of Common Stock purchased?
Certificates evidencing shares will be held by the Plan
Administrator. Certificates for shares of Common Stock purchased under the Plan
will not be issued to participants unless requested. This service protects
against loss, theft or destruction of stock certificates. The number of shares
credited to a participant's account under the Plan will be shown on the
participant's statement of account.
Certificates for any number of whole shares credited to a
participant's account under the Plan will be issued to a participant without
charge upon the participant's written request. Until a participant sells such
shares or changes the number of participating shares, dividends on all such
shares will continue to be invested under the Plan even though certificates are
held by the participant. Certificates for fractional shares will not be issued
under any circumstances.
Shares credited to a participant's account under the Plan may not
be pledged, sold or transferred unless the participant has withdrawn such
shares from the Plan by requesting and receiving certificates for such shares
registered in the participant's name. Each account under the Plan is maintained
in the name in which a participant's shares are registered at the time the
participant enters the Plan.
WITHDRAWALS AND TERMINATION
18. How may a participant withdraw shares from the Plan?
A participant may withdraw any or all full shares credited to his
or her Plan account at any time, by notifying the Plan Administrator in writing
and specifying the number of shares to be withdrawn. Certificates for whole
shares of Common Stock so withdrawn will be issued to and registered in the
name of the participant. If a participant requests, the Plan Administrator will
sell all or a portion of the withdrawn shares and remit the proceeds, less any
related brokerage commissions and applicable withholding or transfer taxes, if
any, to the participant. The Plan Administrator will sell the shares in the
open market at the prevailing market price within ten (10) business days after
receipt of the request or as soon as otherwise practicable. Any notice of
withdrawal received after a dividend record date will not be effective until
dividends paid for such record date have been reinvested and the shares
purchased have been credited to a participant's account.
Should a participant withdraw all shares from the Plan thereby
terminating its participation in the Plan, the Plan Administrator may sell the
participant's interest in any remaining fractional share and close the
participant's account. The net proceeds from such sale will be mailed to the
participant.
19. How and when may a participant terminate participation in the Plan?
A participant may terminate participation in the Plan at any time
by written notice to the Plan Administrator. As soon as practicable following
termination, the Plan Administrator will send the participant a certificate for
the number of whole shares in the participant's account and a check in an
amount equal to the value of any fractional share based upon the average of the
daily high and low sales prices of the Common Stock as reported on the NASDAQ
National Market System for the date of termination as set forth in the
statement sent to the participant by the Plan Administrator. If the participant
requests, the Plan Administrator will sell all of the shares held in the
participant's account in the manner described in Question 18 and send the
participant a check for the proceeds from the sale, less any related brokerage
commissions and applicable withholding or transfer taxes, if any.
If a participant's request to terminate participation in the Plan
is received on or after the record date for a dividend, cash dividends paid
with respect to that record date will be reinvested in shares of Common Stock
for the participant's account. Any optional cash payments sent to the Plan
Administrator prior to the request for termination will be invested unless
return of the amount is expressly requested in the request for termination and
the request is received at least two (2) business days prior to the time when
such amount would otherwise be applied to purchase shares. If dividends or
optional cash payments are invested after the Plan Administrator has received a
request to terminate Plan participation, the request will be processed as
promptly as possible.
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Participation in the Plan will also be terminated if the Plan
Administrator receives written notice of the death or adjudicated incompetency
of a participant. Upon termination by reason of notice of death or adjudicated
incompetency, no purchase of shares of Common Stock will be made for the
participant's account and the participant's shares, any cash dividends paid
thereon and any other unapplied funds will be retained by the Plan
Administrator until such time as such participant's legal representative has
been appointed and has furnished proof satisfactory to the Plan Administrator
of the legal representative's right to receive payment.
After termination of Plan participation, all cash dividends will be
paid to the shareholder in cash unless the shareholder rejoins the Plan, which
he or she may do at any time by completing and returning to the Plan
Administrator an Authorization Form as described in Question 4.
CERTAIN TAX CONSEQUENCES OF PARTICIPATION IN THE PLAN
20. What are the Puerto Rico and federal income tax consequences of
participation in the Plan?
The following statements, which are based upon existing tax laws,
regulations and rulings on the date of this Prospectus, are intended to be a
general outline of the likely Puerto Rico and federal income tax consequences
to an individual or corporate participant in the Plan. The Company has been
advised with regard to such statements by Pietrantoni Mendez & Alvarez, San
Juan, Puerto Rico.
The information herein provided is a summary and does not purport
to be a complete description of the income tax consequences to any participant
in the Plan. In particular, it does not address the income tax consequences to
an individual participant who is a non-resident alien. Participants should
consult their own tax advisors for further information concerning the tax
consequences of participation in the Plan.
GENERAL TAX CONSEQUENCES
(a) In the case of shares of Common Stock purchased from the
Company at a discount with cash dividends, the fair market value on the
dividend payment date of the shares purchased, plus the amount of any tax
withheld, will constitute dividend income to the participant. The participant's
tax basis in such shares will be the fair market value of the shares on the
dividend payment date.
(b) A participant acquiring shares of Common Stock through optional
cash payments under the Plan will not realize taxable income on the purchase of
shares for his or her account, except that the participant will have dividend
income in the amount of any brokerage commissions or service fees paid by the
Company, if any. The tax basis of shares of Common Stock purchased for a
participant's Plan account with optional cash payments will be the amount of
the optional cash payments plus an allocable share of any brokerage commissions
paid by the Company, if any.
(c) A participant's holding period for shares of Common Stock
acquired pursuant to the Plan will begin on the day following the date the
shares of Common Stock are credited to the participant's account.
(d) A participant will not realize taxable income when he or she
receives certificates for whole shares of Common Stock credited to the
participant's account, either upon the participant's request for such
certificates or upon termination of the Plan or termination of his or her
participation in the Plan.
(e) A participant will realize gain or loss when the shares of
Common Stock are sold or exchanged, and in the case of a fractional share, when
the participant receives a cash payment for a fraction of a share credited to
the participant's account
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upon termination of participation in or termination of the Plan. The amount of
such gain or loss will be the difference between the amount which the
participant receives for the shares or fraction of a share and the tax basis
thereof.
(f) In the case of holders of Common Stock whose dividends are
subject to Puerto Rico income tax withholding, the Company will withhold the
tax from the cash dividends and invest the balance in shares of Common Stock.
Based on a private letter ruling issued by the Puerto Rico Department of the
Treasury, the Company will not withhold taxes on the additional dividend
resulting from the discount in the purchase of shares and any brokerage
commissions or service fees paid by the Company under the Plan. The Company
will report the amount of such additional dividend to the Puerto Rico
Department of the Treasury and to participants at the end of each calendar
year. In addition, the Company will send participants a letter advising them of
their obligation to file Puerto Rico income tax returns and to pay the tax due
on the portion of the dividend attributable to the amount of the discount and
the brokerage commissions or service fees. In the case of participants who
qualify for the special tax of ten percent (10%) on dividends, such special
rate will apply to the additional dividend. The statements confirming purchases
made for such participants will indicate the amount of tax withheld and the
amount of discount received.
PUERTO RICO INCOME TAX CONSEQUENCES
Individuals
(a) An individual participant in the Plan, whether a resident of Puerto
Rico or a non-resident U.S. citizen, will be subject to a special tax equal to
ten percent (10%) of the total amount of each cash dividend distribution. This
special tax will be automatically deducted and withheld by the Company unless
the participant has in effect on the date of the distribution an election not
to have the special dividend tax withheld.
(b) An individual participant who is a non-resident U.S. citizen will be
subject to a ten percent (10%) income tax withholding at source on the gross
amount of cash dividends, unless, in addition to the election not to have the
special dividend tax withheld, he has filed with the Plan Administrator a
Withholding Exemption Certificate for exemption from the ten percent (10%)
withholding tax. In this case, the maximum amount of Puerto Rico source gross
income (including the dividends distributed by the Company and any gain from
the sale in Puerto Rico of common stock) that the non-resident U.S. citizen
will receive exempt from withholding is $1,300 if single, or $3,000 if married
and living with spouse. The Company will withhold a ten percent (10%) income
tax on the non-resident U.S. citizen's dividend distribution in excess of the
above specified amounts.
Furthermore, a non-resident U.S. citizen will be required to file a
Puerto Rico income tax return and will be subject to tax at the same tax rates
as Puerto Rico residents if his Puerto Rico source gross income exceeds the
$1,300 and $3,000 limits. The tax withheld by the Company may be credited in
the return against the resulting Puerto Rico tax liability, if any, or refunded
to the individual as the case may be. Even though the non-resident U.S. citizen
may be required to file a Puerto Rico income tax return, he will not be subject
to any Puerto Rico income tax liability if his gross income from Puerto Rico
sources is $3,300 or less, if single, or $6,000 or less, if married and living
with spouse. However, a non-resident U.S. citizen will not be required to file
a Puerto Rico income tax return if such participant's gross income from sources
within Puerto Rico consists only of cash dividends on Common Stock and such
dividends are subject to the special 10% tax to be withheld at source.
(c) In the case of the sale or exchange of Common Stock, an individual
who is a Puerto Rico resident has the option to have his net long term capital
gain taxed at a special twenty percent (20%) rate or to include it in his gross
income and be subject to the normal tax rates.
(d) An individual participant who is a non-resident U.S. citizen will not
be subject to Puerto Rico income tax on the sale or exchange of Common Stock if
the sale or exchange is effected outside Puerto Rico. If the sale takes place
in Puerto Rico, the gain will be subject to the same capital gain provisions
applicable to a Puerto Rico resident and the buyer is required to withhold
twenty percent (20%) from the sales price.
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Corporations
(a) In the case of participant corporations, the special ten percent
(10%) tax on dividends and capital gains discussed above will not apply.
(b) In the case of participant corporations organized in Puerto Rico
("domestic corporations") and participant corporations organized outside Puerto
Rico but that are engaged in trade or business in Puerto Rico ("resident
foreign corporations"), the full amount of dividend income will be eligible for
the eighty-five percent (85%) dividends received deduction provided the
dividend deduction does not exceed eighty-five percent (85%) of the corporate
taxpayer's net taxable income reported in Puerto Rico.
(c) In the case of participant corporations organized outside Puerto Rico
and not engaged in trade or business in Puerto Rico ("non-resident foreign
corporations"), the full amount of dividend income will be subject to a ten
percent (10%) withholding tax at source. On the sale or exchange of Common
Stock, these non-resident foreign corporations would be subject to a
twenty-five percent (25%) income tax withholding on the gross amount received
to the extent said amount constitutes income from sources within Puerto Rico.
However, the tax withheld will be credited against the Puerto Rico income tax
liability reported by the corporation on its Puerto Rico return, which would be
twenty-nine percent (29%) of the excess capital gains over capital losses from
Puerto Rico sources.
(d) For Puerto Rico tax purposes, the gain from the sale of stock is
considered derived from the place where all rights, title and interest on the
stock pass from seller to purchaser. In the case of foreign corporations,
whether resident or nonresident, if the sale is effected outside Puerto Rico,
the gain will not be subject to Puerto Rico income taxes except for certain
resident foreign corporations engaged in a financial business or in the
business of trading in securities.
(e) In the case of a domestic corporation, income from the sale or
exchange of Common Stock will be subject to a twenty-five percent (25%) maximum
tax on the capital gain irrespective of where the sale is effected. To the
extent the gain constitutes income from sources within Puerto Rico or otherwise
constitutes income effectively connected with a Puerto Rico business, a
resident foreign corporation will also be subject to this maximum twenty-five
percent (25%) tax rate.
Institutional Investors
Dividends paid to certain institutional investors such as life
insurance companies may or may not be subject to Puerto Rico income tax.
Participants should contact their own tax advisors as to the applicability of
this exemption.
FEDERAL INCOME TAX CONSEQUENCES
(a) In the case of a participant who is a U.S. citizen not a resident of
Puerto Rico, dividend distributions from the Company and gain from the sale
of Common Stock will have to be included in full in his or her federal income
tax return. However, Puerto Rico taxes paid may generally be taken as a foreign
tax credit against the United States income tax liability, or in the
alternative, as an itemized deduction.
(b) In the case of a participant who is a U.S. citizen and a
bona fide resident of Puerto Rico for the entire taxable year, dividend
distributions from the Company and gain from the sale of Common Stock are
excludable from the federal return.
(c) In the case of a participant which is a United States corporation,
the full amount of dividends distributed will be included in gross income, but
will not be eligible for the dividends received deduction. However, taxes paid
in Puerto Rico may generally be taken as a foreign tax credit or as a deduction
in the federal income tax return.
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<PAGE> 15
OTHER INFORMATION
21. May shares credited to a participant's account be sold, pledged or
transferred?
Shares credited to a participant's account may not be sold, pledged
or transferred unless the participant has requested and received certificates
for such shares registered in the participant's name.
22. What happens if a participant sells or transfers some or all of the
shares registered in the participant's name?
If a participant sells or transfers all shares registered in the
participant's name, dividends on shares credited to the participant's account
under the Plan will, unless the participant also withdraws all shares held in
his account, continue to be reinvested, except that if the participant has only
a fractional share of Common Stock credited to his account under the Plan, the
Company may close the participant's account and sell the fractional share. In
such event, the participant will receive a check for the net proceeds from the
sale of the fractional share.
If a participant sells or transfers a portion of the shares
registered in the participant's name and the participant has chosen the Full
Dividend Reinvestment option, dividends on all shares remaining registered in
the participant's name will continue to be reinvested. If the participant has
chosen the Partial Dividend Reinvestment option, dividends on a number of
shares remaining registered in the participant's name up to the number of
shares originally authorized will continue to be reinvested.
23. If the Company has a rights offering, how will the rights on Plan
shares be handled?
A rights offering takes place when the Company issues to existing
shareholders the right to purchase additional shares of Common Stock in
proportion to the shares they already own. A participant's entitlement in a
rights offering will be based upon his or her total holdings. Rights will be
issued for the number of whole shares only.
A rights offering such as the one referred to in this Question 23
is not related to the Preferred Rights (as defined below) attached to the
shares of Common Stock. See "DESCRIPTION OF CAPITAL STOCK - Stockholder Rights
Plan" herein.
24. What happens if the Company issues a dividend payable in stock or
declares a stock split?
Any stock dividends or split shares distributed by the Company on
shares registered in a participant's name or credited to a participant's Plan
account will be added to the participant's Plan account and reflected in the
statement described in Question 16.
25. How will Plan participants' shares be voted at shareholders'
meetings?
Shares credited to a participant's Plan account will be voted as
the participant directs. A proxy card will be sent to each participant in
connection with all annual and special meetings of shareholders. This proxy
will apply to all whole shares registered in a participant's name, if any, as
well as to all shares credited to a participant's account under the Plan and,
if properly signed, will be voted in accordance with the instructions given by
the participant on the proxy card. If a proxy card is returned properly signed,
but without indicating instructions as to the manner shares are to be voted
with respect to any item thereon, the shares covered will be voted in
accordance with the recommendations of the Company's management. If the proxy
card is not returned, or it is returned unexecuted or improperly executed, the
shares of Common Stock covered will not be voted unless the participant or the
participant's duly appointed representative votes in person at the meeting.
26. What are the responsibilities of the Company, the Plan
Administrator, the Agent and the Information Agent under the Plan?
The Company, the Plan Administrator, the Agent and the Information
Agent will not be liable under the Plan for any act done in good faith or for
any good faith omission to act, including, without limitation, any claim of
liability arising out of failure to terminate a participant's account upon the
participant's death, the prices at which shares are purchased or sold for a
participant's
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account, the times when purchases or sales are made, or fluctuations in the
market value of the Company's Common Stock. PARTICIPANTS SHOULD RECOGNIZE THAT
THE COMPANY, THE PLAN ADMINISTRATOR, THE AGENT AND THE INFORMATION AGENT CANNOT
PROVIDE ANY ASSURANCE OF A PROFIT OR PROTECTION AGAINST A LOSS ON THE SHARES OF
COMMON STOCK PURCHASED OR HELD UNDER THE PLAN. The Company, the Plan
Administrator, the Agent and the Information Agent and their agents will not
have any responsibility beyond the exercise of ordinary care for any action
taken or omitted to be taken in connection with the Plan, nor do they have any
duties, responsibilities or liabilities other than those expressly set forth in
the Plan.
Stockholders should be aware and are cautioned that this Prospectus
does not represent a change in the Company's dividend policy nor a guarantee of
future dividends, which will continue to depend upon the Company's earnings,
financial requirements, governmental regulations and other factors.
27. What happens if purchases cannot be made in the open market?
If the Company determines not to make newly issued shares of Common
Stock available for purchase pursuant to the Plan and in the event that
applicable law or the closing of securities' markets requires the temporary
curtailment or suspension of open market purchases of shares under the Plan,
the Agent will not be accountable for its inability to make purchases at such
times. If shares of Common Stock are not available for purchase for a period
longer than forty-five days, the Plan Administrator will promptly mail to the
participant a check payable to the participant's order in the amount of any
unapplied funds in the participant's account.
28. May the terms of the Plan be changed or the Plan suspended or
discontinued?
Yes. The Company reserves the right to modify the terms of the Plan
at any time and from time to time, and the Company may suspend or terminate the
Plan at any time, including the period between a record date and a dividend
payment date, in each case in its sole discretion. Notice of any material
amendment or modification, or of any suspension or termination, will be mailed
to all participants.
Upon termination of the Plan, any uninvested optional cash payments
will be returned, a certificate for whole shares of Common Stock credited to a
participant's Plan account will be issued, and a cash payment will be made for
the net proceeds from the sale of any fractional share credited to a
participant's account.
29. Can successor Plan Administrators or Agents be named?
The Company may from time to time designate a bank, trust company,
brokerage firm or other financial institution as successor Plan Administrator
or Agent under the Plan.
30. Can the Company or the Plan Administrator terminate a participant's
interest in the Plan?
The Company or the Plan Administrator may terminate any
participant's participation in the Plan at any time for any reason, including,
without limitation, arbitrage-related activities or transactional profit
activities, by notice in writing mailed to the participant. In such event the
Plan Administrator will follow the procedures for termination set forth in
Question 19.
31. May a participant add shares of Common Stock to his or her account
by transferring stock certificates that the participant possesses?
Yes. A participant may increase the number of shares of Common
Stock held in his or her account by depositing certificates representing shares
of Common Stock with the Plan Administrator. Such certificates must be
presented in transferable form and must be accompanied by a written request
that the shares of Common Stock evidenced thereby be added to the participant's
account.
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32. What is sufficient notice to a participant?
Any notice or certificate which by any provision of the Plan is
required to be given by the Plan Administrator to a participant shall be in
writing and shall be deemed to have been sufficiently given for all purposes by
being deposited postage prepaid in a post office letter box addressed to the
participant at the participant's address as it shall last appear on the Plan
Administrator's records.
33. Who interprets the Plan and what law governs?
Any question of interpretation under the Plan will be determined by
the Company under the laws of the Commonwealth of Puerto Rico, and any such
determination will be final.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 180,000,000
shares of Common Stock, par value $6 per share, and 10,000,000 shares of
Preferred Stock. The Preferred Stock is issuable in one or more series, with
such terms, and at such times and for such consideration as the Board of
Directors of the Company determines. As of June 15, 1997, there were issued and
outstanding 4,000,000 shares 8.35% Series A Preferred Stock and 66,692,039
shares of Common Stock. The Common Stock is traded in the over-the-counter
market on the NASDAQ National Market System.
The following description summarizes the material provisions of the
Common Stock. It does not purport to be complete and is subject in all respects
to the applicable provisions of the General Corporation Law of Puerto Rico, the
Company's Restated Certificate of Incorporation (the "Certificate"), the Rights
Agreement (defined below), the Certificate of Designation describing the Series
A Participating Preferred Stock and the Plan.
COMMON STOCK
Subject to the rights of holders of any Preferred Stock outstanding,
holders of Common Stock are entitled to receive ratably such dividends, if any,
as the Board of Directors may in its discretion declare out of legally
available funds.
The holders of the Common Stock are entitled to one vote per share on all
matters brought before the stockholders. The holders of the Common Stock do not
have the right to cumulate their shares of Common Stock in the election of
directors. The Certificate provides that the approval of a merger,
reorganization, or consolidation of the Company or the sale of substantially
all of the assets of the Company or the approval or voluntary dissolution of
the Company requires the vote of the holders of 75% of the total number of
outstanding shares of the Company.
In the event of liquidation, holders of the Common Stock will be entitled
to receive pro rata any assets distributable to shareholders with respect to
the shares held by them, after payment of indebtedness and such preferential
amounts as may be required to be paid to the holders of any Preferred Stock
hereafter issued by the Company.
The Certificate provides that the members of the Board of Directors are
divided into three classes as nearly equal as possible. Each class is elected
for a three-year term. At each annual meeting of shareholders, one-third of the
members of the Board of Directors will be elected for a three-year term, and
the other directors will remain in office until their three-year terms expire.
Therefore, control of the Board of Directors cannot be changed in one year, and
at least two annual meetings must be held before a majority of the members of
the Board of Directors can be changed.
The Certificate provides that a director, or the entire Board of
Directors, may be removed by the shareholders only for cause. The Certificate
and Bylaws of the Company also provide that the affirmative vote of the holders
of at least two-thirds of the combined voting power of the outstanding capital
stock entitled to vote for the election of directors is required to remove a
director
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or the entire Board of Directors from office. Certain portions of the
Certificate of the Company described in certain of the preceding paragraphs,
including those related to business combinations and the classified Board of
Directors, may be amended only by the affirmative vote of the holders of
two-thirds of the total number of outstanding shares of the Company.
Certain of the provisions contained in the Certificate have the effect of
making it more difficult to change the Board of Directors, and may make the
Board of Directors less responsive to shareholder control. These provisions
also may tend to discourage attempts by third parties to acquire the Company
because of the additional time and expense involved and a greater possibility
of failure, and, as a result, may adversely affect the price that a potential
purchaser would be willing to pay for the capital stock of the Company, thereby
reducing the amount a shareholder might realize in, for example, a tender offer
for the capital stock of the Company.
Pursuant to the Certificate, holders of the Common Stock and only the
Common Stock are entitled to preferential rights to purchase or subscribe for
newly issued shares of Common Stock on a pro rata basis unless, in approving
the issuance of Common Stock, or any transaction resulting in the issuance of
any Common Stock of the Company, the Board of Directors of the Company
unanimously resolves otherwise. The shareholders have no preference to
subscribe therefor in the event of new issues of shares of stock which may be
authorized pursuant to any dividend reinvestment and stock purchase plan of the
Company or which may be authorized in order to exchange such new shares of
stock for property which the Board of Directors may consider convenient or
necessary for the Company to acquire, nor shall the shareholders have any right
of preference therefor in the event of new issues of stock in payment of
services rendered to the Company, or of shares of stock to be issued to
officers or employees, on the basis of options, as an incentive either to
commence or to continue rendering services for the Company. There are no
redemption or call provisions applicable to shares of Common Stock.
The outstanding shares of Common Stock are, and shares of Common Stock
offered hereby upon their due issuance, delivery and the receipt of payment
therefor will be fully paid and nonassessable.
The Registrar and Transfer Agent for the Common Stock of the Company is
Banco Popular de Puerto Rico.
STOCKHOLDER RIGHTS PLAN
Pursuant to a Rights Agreement, dated as of August 11, 1988, as amended
as of December 11, 1990 (the "Rights Agreement"), between the Company and Chase
Manhattan Bank, holders of shares of Common Stock outstanding at the close of
business on August 31, 1988 received the right (the "Preferred Rights") to
purchase one one-hundredth of a share of Series A Participating Cumulative
Preferred Stock of the Company ("Series A Participating Preferred Stock") on
the terms set forth in the Rights Agreement. There is one Preferred Right
attached to each share of Common Stock outstanding. In addition, as long as the
Preferred Rights are attached to the Common Stock, one Preferred Right will be
issued with each new share of Common Stock issued. At the time the Preferred
Rights become exercisable, separate certificates will be issued and the
Preferred Rights could begin to trade separately from the Common Stock.
Preferred Rights become exercisable (i) on the close of business on the tenth
business day after the Company or any person or group publicly announces that
such person or group has acquired 15% or more of the shares of the Common Stock
then outstanding, or (ii) on the close of business on the tenth business day
after the commencement of a tender or exchange offer which, if consummated,
would result in such person becoming the beneficial owner of 20% or more of the
Common Stock. The Preferred Rights may be deemed to have an anti-takeover
effect and generally may cause substantial dilution to a person or group that
attempts to acquire the Company under circumstances not approved by the
Company's Board of Directors.
PREFERRED STOCK
The Board of Directors of the Company is authorized to provide for the
issuance of shares of the Company's Preferred Stock in one or more series, with
such voting powers, full or limited, or without voting powers, and with such
designations, preferences and relative, participating, optional or other
special rights, and qualifications, limitations or restrictions thereof, as
shall be stated and expressed in the resolution or resolutions providing for
the issuance thereof to be adopted by the Board of Directors, except as
otherwise provided in the Certificate or any amendment thereto. The issuance of
shares of Preferred Stock could make it more difficult and more expensive for
another person or entity to obtain control of the Company in a merger, tender
offer, proxy fight
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or similar transaction. The ability of the Board of Directors to issue shares
of Preferred Stock in such a situation could have the effect of discouraging a
potential acquiror and may have an adverse effect on shareholders wishing to
participate in a merger, tender offer or proxy fight. The Company's management
is not aware of any person or entity currently seeking control of the Company.
The 8.35% Series A Preferred Stock entitle the holders thereof to
receive, when, as and if declared by the Board of Directors of the Company's,
out of funds legally available therefor, cash dividends at the annual rate per
share of 8.35% of the liquidation preference of $25 per share, or $0.173958 per
share per month, accruing from the date of original issuance and payable
monthly in arrears in United States dollars on the last day of each calendar
month thereafter.
Dividends on the 8.35% Series A Preferred Stock are non-cumulative. To
the extent that funds are not legally available for the payment of such
dividends for any monthly dividend period or that such dividends are not
declared with respect to any monthly dividend period, then the holders of the
8.35% Series A Preferred Stock have no right to receive a dividend in respect
of such monthly dividend period. The Company may not pay dividends on or
acquire shares of Common Stock of the Company or other class of stock of the
Company ranking junior to the 8.35% Series A Preferred Stock unless all accrued
and unpaid dividends on the 8.35% Series A Preferred Stock for the twelve
monthly dividend periods ending on the immediately preceding dividend payment
date shall have been paid or are paid contemporaneously and the full monthly
dividend on the 8.35% Series A Preferred Stock for the then current month has
been or is contemporaneously declared and paid or declared and set apart for
payment.
The 8.35% Series A Preferred Stock is redeemable on and after June 30,
1998, at the option of the Company, in whole or in part from time to time. The
redemption price per share is $26.25 from June 30, 1998 through June 29, 1999,
$26.00 from June 30, 1999 through June 29, 2000, $25.75 from June 30, 2000
through June 29, 2001, $25.50 from June 30, 2001 through June 29, 2002, and
$25.00 from June 30, 2002 and thereafter, plus accrued and unpaid dividends for
the then current monthly dividend period to the date fixed for redemption.
Under current regulations, the Company is not permitted to exercise any option
to redeem shares of 8.35% Series A Preferred Stock without the prior approval
of the Federal Reserve Board.
The 8.35% Series A Preferred Stock is not convertible into or
exchangeable for any other securities of the Company. Holders of shares of
8.35% Series A Preferred Stock have no right to require the Company to redeem
or repurchase any such shares, and such shares are not subject to any sinking
fund or similar obligation.
In the event of the liquidation, dissolution or winding up of the
Company, holders of the 8.35% Series A Preferred Stock will be entitled to
receive a liquidation preference of $25 for each share, plus accrued and unpaid
dividends for the then current monthly dividend period to the date of payment.
LEGAL OPINION
The validity of the Common Stock to be issued pursuant to the Plan has
been passed upon for the Company by Pietrantoni Mendez & Alvarez, San Juan,
Puerto Rico, special counsel to the Company. As of the date of this
Prospectus, partners and associates of Pietrantoni Mendez & Alvarez owned, in
the aggregate, approximately 8,437 shares of Common Stock.
EXPERTS
The consolidated financial statements incorporated in this Prospectus by
reference from the Company's Annual Report on Form 10-K for the year ended
December 31, 1996, have been so incorporated in reliance on the report of Price
Waterhouse, independent accountants, given upon the authority of said firm as
experts in auditing and accounting.
17
<PAGE> 20
===============================================================================
NO PERSON HAS BEEN AUTHORIZED, IN CONNECTION WITH THE OFFERING DESCRIBED IN
THIS PROSPECTUS, TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT
CONTAINED IN THIS PROSPEC TUS, AND IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY TO ANY PERSON IN ANY
JURISDICTION WHERE SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF.
-----------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
AVAILABLE INFORMATION..........................................................................................2
INCORPORATION OF CERTAIN DOCUMENTS
BY REFERENCE...............................................................................................2
THE COMPANY....................................................................................................3
USE OF PROCEEDS................................................................................................3
DESCRIPTION OF THE PLAN........................................................................................3
Purpose....................................................................................................3
Advantages.................................................................................................4
Participation..............................................................................................4
Purchases Under the Plan...................................................................................6
Optional Cash Payments.....................................................................................7
Costs......................................................................................................8
Administration.............................................................................................8
Reports to Participants....................................................................................8
Certificates for Shares....................................................................................9
Withdrawals and Termination................................................................................9
Certain Tax Consequences of Participation in the Plan.....................................................10
General Tax Consequences..................................................................................10
Puerto Rico Income Tax Consequences.......................................................................11
Individuals..........................................................................................11
Corporations.........................................................................................12
Institutional Investors..............................................................................12
Federal Income Tax Consequences...........................................................................12
Other Information.........................................................................................13
DESCRIPTION OF CAPITAL STOCK..................................................................................15
Common Stock..............................................................................................15
Stockholder Rights Plan...................................................................................16
Preferred Stock...........................................................................................16
LEGAL OPINION.................................................................................................17
EXPERTS.......................................................................................................17
</TABLE>
===============================================================================
POPULAR, INC.
DIVIDEND REINVESTMENT
AND
STOCK PURCHASE PLAN
COMMON STOCK
(PAR VALUE $6 PER SHARE)
----------------------
PROSPECTUS
DATED JULY 8, 1997
===============================================================================
<PAGE> 21
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
<TABLE>
<CAPTION>
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*
<S> <C>
Securities and Exchange Commission registration fee ............................................ $ 24,470
Legal fees and expenses......................................................................... 7,500
Printing expenses............................................................................... 5,000
Accounting fees and expenses.................................................................... 2,000
TOTAL......................................................................... 38,970
=======
</TABLE>
- -----------
*All of such items except the registration fee are estimated. All of such
expenses will be borne by the Company.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Popular, Inc. is a Puerto Rico corporation.
Article ELEVENTH of the Restated Certificate of Incorporation
of Popular, Inc. provides the following:
(1) The Corporation shall indemnify any person
who was or is a party or is threatened to be made a
party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action
by or in the right of the Corporation) by reason of the
fact that he is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the
written request of the Corporation as a director,
officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in
good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action,
suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, create a presumption
that the person did not act in good faith and in a
manner which he reasonably believed to be in or not
opposed to the best interests of the Corporation and,
with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was
unlawful.
(2) The Corporation shall indemnify any person
who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he is
or was a director, officer, employee or agent of the
Corporation, or is or was serving at the written
request of the Corporation as a director, officer,
II-1
<PAGE> 22
employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against
expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the
defense or settlement of such action or suit if he
acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests
of the Corporation, except that no indemnification
shall be made in respect of any claim, issue or matter
as to which such person shall have been adjudged to be
liable for negligence or misconduct in the performance
of his duty to the Corporation unless and only to the
extent that the court in which such action or suit was
brought shall determine upon application that, despite
the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses
which such court shall deem proper.
(3) To the extent that a director, officer,
employee or agent of the Corporation has been
successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in paragraph 1
or 2 of this Article ELEVENTH, or in defense of any
claim, issue or matter therein, he shall be indemnified
against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection therewith.
(4) Any indemnification under paragraph l or 2 of
this Article ELEVENTH (unless ordered by a court) shall
be made by the Corporation only as authorized in the
specific case upon a determination that indemnification
of the director, officer, employee or agent is proper
in the circumstances because he has met the applicable
standard of conduct set forth therein. Such
determination shall be made (a) by the Board of
Directors by a majority vote of a quorum consisting of
directors who were not parties to such action, suit or
proceeding, or (b) if such a quorum is not obtainable,
or, even if obtainable, a quorum of disinterested
directors so directs, by independent legal counsel in a
written opinion, or (c) by the shareholders.
(5) Expenses incurred in defending a civil or
criminal action, suit or proceeding may be paid by the
Corporation in advance of the final disposition of such
action, suit or proceeding as authorized by the Board
of Directors in the specific case upon receipt of an
undertaking by or on behalf of the director, officer,
employee or agent to repay such amount unless it shall
untimely be determined that he is entitled to be
indemnified by the Corporation as authorized in this
Article ELEVENTH.
(6) The indemnification provided by this Article
ELEVENTH shall not be deemed exclusive of any other
rights to which those seeking indemnification may be
entitled under any statute, by-law, agreement, vote of
shareholders or disinterested directors or otherwise,
both as to action in his official capacity and as to
action in another capacity while holding such office,
and shall continue as to a person who has ceased to be
a director, officer, employee or agent and shall inure
to the benefit of the heirs, executors and
administrators of such a person.
(7) By action of its Board of Directors,
notwithstanding any interest of the directors in the
action, the Corporation may purchase and maintain
insurance, in such amounts as the Board of Directors
deems appropriate, on behalf of any person who is or
was a director, officer, employee or agent of the
Corporation, or is or was serving at the written
request of the Corporation as a director, officer,
employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against any
liability asserted against him and incurred by him in
any such capacity, or arising out of his status as
such, whether or not the Corporation would have the
II-2
<PAGE> 23
power or would be required to indemnify him against
such liability under the provisions of this Article
ELEVENTH or of the General Corporation Law of the
Commonwealth of Puerto Rico or of any other state of
the United States or foreign country as may be
applicable.
<TABLE>
<CAPTION>
ITEM 16. EXHIBITS.
<S> <C> <C>
(3)(i) - Articles of Incorporation of Popular, Inc. (incorporated by reference to Exhibit (4)(a) of
Registration Statement No. 333-26941)
(3)(ii) - Bylaws of Popular, Inc. (incorporated by reference to Exhibit 4.1 of Registration Statement
No. 33-39028)
(4)(a) - Form of certificate for common stock (incorporated by reference to Exhibit 4.1 of
Popular, Inc's Annual Report on Form 10-K for the year ended December 31, 1990 (the "1990
Form 10-K"))
(4)(b) - Certificates of Resolutions of the Board of Directors of Popular, Inc. dated August 11, 1988
creating a series of Preferred Stock of Popular, Inc. designated as Series A Participating
Cumulative Preferred Stock Purchase rights and the designation and amount of such series,
the voting power preferences, and relative, participating, optional, or other special rights of
the shares of such series, and the qualifications, limitations or restrictions thereof. Rights
Agreement dated as of August 11, 1988 by and between Popular, Inc. and Manufacturers
Hanover Trust Company regarding the issuance of certain Rights to Popular, Inc.'s
shareholders. (Incorporated by reference to Exhibit 4.3 of Registration Statement No. 33-
39028)
(4)(c) - Amendment to Rights Agreement dated as of December 11, 1990. (incorporated by reference
to Exhibit 4.4 of Registration Statement No. 33-39028)
(4)(d) - Indenture, dated as of October 1, 1991, as amended, among Popular North America, Inc.,
Popular, Inc. and The First National Bank of Chicago, relating to the debt securities of
Popular North America, Inc. guaranteed by Popular, Inc. (incorporated by reference to
Exhibit 4(c) to Registration Statement No. 33-41686 and to Exhibit 4(a) on Form 8-K filed
on February 28, 1995)
(4)(e) - Form of medium-term fixed rate note of Popular North America, Inc. guaranteed by
Popular, Inc. (incorporated by reference to Exhibit 2 on Form 8-K filed on October 8, 1991)
(4)(f) - Form of medium-term floating rate note of Popular North America, Inc. guaranteed by Popular,
Inc. (incorporated by reference to Exhibit 3 on Form 8-K filed on October 8, 1991)
(4)(g) - Form of Certificate of 8.35% Non-cumulative Monthly Income Preferred Stock, 1994 Series
A (Liquidation Preference $25.00 per share). (incorporated by reference to Exhibit 4.7 of the
1994 Form 10-K)
(4)(h) - Subordinated indenture of Popular, Inc., dated November 30, 1995, between Popular, Inc. and
The First National Bank of Chicago, as trustee. (incorporated by reference to Exhibit 4(e) on
Form 8-K filed on December 13, 1995)
(4)(i) - Form of subordinated note of Popular, Inc. (incorporated by reference to Exhibit 4(p) on
Form 8-K filed on December 13, 1995)
(4)(j) - Indenture, dated as of February 15, 1995, as supplemented by the First Supplemental Indenture thereto,
dated as of May 8, 1997, each between Popular, Inc. and The First National Bank of Chicago, as
trustee. (incorporated by reference to Exhibit 4(c) on Form 8-K filed on April 13, 1995)
(4)(k) - Form of medium-term fixed rate note of (incorporated by reference to Exhibit
4(a) on Form 8-K filed on April 13, 1995)
(4)(l) - Form of medium-term floating rate note of Popular, Inc. (incorporated by reference
to Exhibit 4(b) on Form 8-K filed on April 13, 1995)
(5) - Opinion of Pietrantoni Mendez & Alvarez
(23)(a) - Consent of Price Waterhouse.
</TABLE>
II-3
<PAGE> 24
<TABLE>
<S> <C> <C>
(23)(b) - Consent of Pietrantoni Mendez & Alvarez (included in Exhibit (5))
(24) - Powers of Attorney (included on pages II-5 through II-6).
99(a) - Specimen Authorization Form (English and Spanish versions).
99(b) - Specimen Broker and Nominee Form.
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(a)(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most recent
post-effective amendment thereto) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement. Notwithstanding the foregoing, any increase or decrease
in volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from the
low or high end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a 20 % change
in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement;
provided, however, that paragraphs (a)(l)(i) and (a)(l)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrants pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and then offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) That, for the purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual report pursuant
to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in this Registration Statement shall be deemed to be
a new registration statement relating to the securities offered therein and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions referred to in Item 15 of
this Registration Statement, or otherwise, the Registrant has been advised that
in the opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification by the Registrant
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-4
<PAGE> 25
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of San Juan, Commonwealth of Puerto Rico, on the
12th day of June, 1997.
POPULAR, INC.
(Registrant)
By: /s/ RICHARD L. CARRION
------------------------------------------
Name: Richard L. Carrion
Title: Chairman, President and
Chief Executive Office
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and
appoints Richard L. Carrion, Jorge A. Junquera, David H. Chafey, Jr. and
Brunilda Santos de Alvarez, and each of them, each with full power to act
without the other, his true and lawful attorneys-in-fact and agents, each with
full power of substitution and resubstitution, for him and in his name, place
and stead in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and any registration
statement relating to the same offering as this Registration Statement that is
to be effective upon filing pursuant to Rule 462(b) under the Securities Act of
1933, and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto each of said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that each of said
attorneys-in-fact and agents, or his substitute or substitutes, may lawfully do
or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ RICHARD L. CARRION Chairman, President and Chief June 12, 1997
- ---------------------------------------- Executive Officer (Chief Executive
Richard L. Carrion Officer)
/s/ SALUSTIANO ALVAREZ MENDEZ Director June 12, 1997
- ----------------------------------------
Salustiano Alvarez Mendez
/s/ ALFONSO F. BALLESTER Director June 12, 1997
- ----------------------------------------
Alfonso F. Ballester
</TABLE>
II-5
<PAGE> 26
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ JUAN J. BERMUDEZ Director June 12, 1997
- -----------------------------------------
Juan J. Bermudez
/s/ FRANCISCO J. CARRERAS Director June 12, 1997
- -----------------------------------------
Francisco J. Carreras
/s/ DAVID H. CHAFEY, JR. Senior Executive Vice President June 12, 1997
- ----------------------------------------- and Director
David H. Chafey, Jr.
Director
- -----------------------------------------
Luis E. Dubon, Jr.
/s/ ANTONIO LUIS FERRE Director June 12, 1997
- -----------------------------------------
Antonio Luis Ferre
/s/ HECTOR R. GONZALEZ Director June 12, 1997
- -----------------------------------------
Hector R. Gonzalez
/s/ JORGE A. JUNQUERA Senior Executive Vice President June 12, 1997
- ----------------------------------------- (Chief Financial Officer) and
Jorge A. Junquera Director
/s/ MANUEL MORALES, JR. Director June 12, 1997
- -----------------------------------------
Manuel Morales, Jr.
/s/ ALBERTO M. PARACCHINI Director June 12, 1997
- -----------------------------------------
Alberto M. Paracchini
Director
- -----------------------------------------
Francisco M. Rexach, Jr.
- -----------------------------------------
Felix J. Serralles Nevares Director
/s/ JULIO E. VIZCARRONDO, JR. Director June 12, 1997
- -----------------------------------------
Julio E. Vizcarrondo, Jr.
/s/ AMILCAR JORDAN Senior Vice President June 12, 1997
- ----------------------------------------- (Principal Accounting Officer)
Amilcar Jordan
</TABLE>
II-6
<PAGE> 1
EXHIBIT 5
July 8, 1997
Popular, Inc.
209 Munoz Rivera Avenue
Hato Rey, Puerto Rico 00918
RE: POPULAR, INC. - DIVIDEND REINVESTMENT
AND STOCK PURCHASE PLAN
Ladies and Gentlemen:
We have acted as counsel to Popular, Inc. (the "Company") in connection
with the Registration Statement on Form S-3 (the "Registration Statement")
filed by the Company with the Securities and Exchange Commission pursuant to
the Securities Act of 1933, as amended, relating to the offer and sale of up to
2,000,000 shares of common stock, par value $6 per share (the "Common Stock"),
by the Company pursuant to the Company's Dividend Reinvestment and Stock
Purchase Plan (the "Plan").
In rendering this opinion, we have examined only the following
documents: (i) the Company's Articles of Incorporation and By-Laws, as amended
and restated, (ii) resolutions adopted by the Company's Board of Directors,
(iii) a copy of the Plan and (iv) the Registration Statement. We have not
performed any independent investigation other than the document examination
described herein. Our opinion is therefore qualified in all respects by the
scope of that document examination. We have assumed and relied, as to
questions of fact and mixed questions of law and fact, on the truth,
completeness, authenticity and due authorization of all certificates, documents
and records examined and the genuineness of all signatures. This opinion is
limited to the laws of the Commonwealth of Puerto Rico.
Based upon and subject to the foregoing, we are of the opinion that the
shares of Common Stock of the Company which are being offered and sold by the
Company pursuant to the Registration Statement, when sold in the manner and for
the consideration contemplated by the Registration Statement and the Plan, will
be legally issued, fully paid and non-assessable.
<PAGE> 2
Popular, Inc.
July 8, 1997
Page 2
We hereby consent to the inclusion of this opinion as an Exhibit to
the Registration Statement and to the reference to our firm under the captions
"Description of the Plan" and "Legal Opinion" in the Prospectus constituting a
part of the Registration Statement. In giving such consent, we do not thereby
admit that we are in the category of persons whose consent is required under
Section 7 of the Act.
Very truly yours,
/s/ Pietrantoni Mendez & Alvarez
<PAGE> 1
EXHIBIT 23(a)
[Price Waterhouse Letterhead]
CONSENT OF INDEPENDENT ACCOUNTANTS
June 30, 1997
To the Board of Directors
Popular, Inc.
(formerly BanPonce Corporation)
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of Popular, Inc.
(formerly BanPonce Corporation) of our report dated February 21, 1997,
appearing on page F-35 of BanPonce Corporation's Annual Report on Form 10-K for
the year ended December 31, 1996. We also consent to the reference to us under
the heading "Experts" in such Prospectus.
/s/ Price Waterhouse
PRICE WATERHOUSE
<PAGE> 1
EXHIBIT 99(a)
[AUTHORIZATION FORM - ENGLISH VERSION]
POPULAR, Inc. Dividend Reinvestment
and Stock Purchase Plan
I wish to participate in the Dividend Reinvestment and Stock Purchase Plan (the
Plan) for the purchase of whole and fractional shares of common stock (Shares)
of Popular, Inc. (the Company) as follows:
[ ] FULL DIVIDEND REINVESTMENT.
I want to reinvest dividends on all Shares now or hereafter registered in
my name. I may also make optional cash deposits.
[ ] PARTIAL DIVIDEND REINVESTMENT.
I want to reinvest dividends on only _____ Shares registered in my name.
I may also make optional cash deposits.
[ ] OPTIONAL CASH DEPOSITS ONLY.
I want to make only optional cash deposits. I do not want to reinvest
dividends on Shares registered in my name.
My participation is subject to the provisions of the Plan as set forth in the
Prospectus relating to the Shares offered pursuant to the Plan. Receipt by me
of such Prospectus is hereby acknowledged. I hereby authorize the Company to
take all action provided for the in the Plan.
THIS IS NOT A PROXY
POPULAR, INC.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
- ------------------------------------ ----------------------------------------
Date Social Security Number (One per account)
----------------------------------------
Signatures of all Registered Owners: Telephone No.
- --------------------------------------------------------------------------------
(In case of joint owners, each owner should sign. Please sign exactly as your
name appears below.)
<TABLE>
<S> <C>
Address: Banco Popular de Puerto Rico
----------------------- Popular, Inc.
----------------------- Dividend Reinvestment Services (718)
----------------------- PO Bo 362708
San Juan, Puerto Rico 00936-2708
If address is not properly shown, please correct before returning. THIS IS NOT A PROXY
(Version en espanol al dorso.)
</TABLE>
<PAGE> 2
EXHIBIT 99(a)
[AUTHORIZATION FORM - SPANISH VERSION]
POPULAR, Inc.
Deseo participar en el Plan de Reinversion de Dividendos y Compra de Acciones
(el Plan) para la compra de acciones comunes enteras o fraccionales (Acciones)
de Popular, Inc. (la Corporacion) de la siguiente manera:
/ / REINVERSION TOTAL DE DIVIDENDOS.
Deseo reinvertir dividendos pagados sobre todas las Acciones actualmente o
en el futuro registradas bajo mi nombre. Tambien podre hacer depositos
opcionales en efectivo.
/ / REINVERSION PARCIAL DE DIVIDENDOS.
Deseo reinvertir dividendos pagados sobre _____ Acciones registradas bajo
mi nombre. Tambien podre hacer depositos opcionales en efectivo.
/ / DEPOSITOS OPCIONALES EN EFECTIVO.
Solamente quiero hacer depositos opcionales en efectivo. No quiero
reinvertir dividendos pagados sobre Acciones registradas bajo mi nombre.
Plan de Reinversion de Dividendos y Compra de Acciones
Mi participacion esta sujeta a las disposiciones del Plan tal como se
establecen en el Prospecto referente a las Acciones ofrecidas con arreglo al
Plan. Por la presente acuso reciho de tal Prospecto. Por la presente autorizo
a la Corporacion a tomar toda accion provista en el Plan.
ESTO NO ES UN APODERAMIENTO
POPULAR, INC.
PLAN DE REINVERSION DE DIVIDENDOS Y COMPRA DE ACCIONES
- ------------------------------ ---------------------------------------
Fecha Numero de Seguro Social (Uno por cuenta)
Firmas de Todo Dueno Registrado: ---------------------------------------
Numero de Telefono
- --------------------------------------------------------------------------------
(En caso de coduenos, cada dueno debera firmar. Favor de firmar exactamente
como su nombre aparece abajo.)
Direccion: Banco Popular de Puerto Rico
Popular, Inc.
---------------------------- Servicios de Reinversion de Dividendos (718)
PO Box 362708
---------------------------- San Juan, Puerto Rico 00936-2708
----------------------------
Favor de corregir su direccion si aparece incorrecta.
ESTO NO ES UN APODERAMIENTO
(English version on reverse.)
<PAGE> 1
EXHIBIT 99(b)
TEL. (787)764-1893
FAX: (787)759-7803
POPULAR, INC.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
BROKER AND NOMINEE FORM
Date:
POPULAR, INC.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
Instructions:
This form is to be used only by brokers, banks, and other nominees submitting
optional cash purchases on behalf of beneficial holders whose shares are held
in the name of a major securities depository, as provided for in the Prospectus
for the Popular, Inc. Dividend Reinvestment and Stock Purchase Plan. This form
will not be processed unless it is completed in its entirety. The broker, bank
or other nominee submitting this form hereby certifies that the information
contained herein is true and correct as of the date of this form. Optional cash
purchases may not exceed $10,000 per month. Unless otherwise specified, the new
shares will be registered in the name of the depository participant named
below.
A NEW FORM MUST BE COMPLETED EACH TIME AN OPTIONAL CASH PURCHASE IS SUBMITTED.
<TABLE>
<S> <C>
Name of depository participant
submitting optional cash purchase
-------------------------------------------------------------
Address
-------------------------------------------------------------
Contact person
-------------------------------------------------------------
Phone ( )
-------------------------------------------------------------
BanPonce Corp. shareholder number (required)
-------------------------------------------------------------
Name of depository
-------------------------------------------------------------
Participant Number
-------------------------------------------------------------
Optional cash purchase amount ($)
-------------------------------------------------------------
(see limitations above)
Form of payment [ ] Check [ ] Money Order [ ]
Wire Transfer (requires
prior written approval
from Plan Administrator)
</TABLE>
ALL FUNDS MUST BE RECEIVED BY THE PLAN ADMINISTRATOR BY 4:00 P.M. (Eastern
Standard Time) ON OR BEFORE THE FIFTEENTH OF EACH MONTH IN ORDER TO BE ELIGIBLE
FOR INVESTMENT DURING THE NEXT INVESTMENT DATE.
-------------------------------------
Broker, Bank or other Nominee
Authorized Signature
